HEARINGS TODAY ON CUSTOMER COSTS TIED TO NUKE PLANT

Edison may bill ratepayers for replacement power, repairs

Utility regulators are soliciting comments from the public as they consider a possible customer refund or suspension of costs associated with the idled San Onofre nuclear plant, at two public hearings today in Costa Mesa.

The California Public Utilities Commission said it will hold public hearings in San Diego, though no dates have been set. The probe into the repair, upkeep and operations of the sidelined plant is expected to stretch into 2014 and beyond.

The twin reactors in North County have been shut since Jan. 31, 2012, when a leak was detected in steam generator tubing that carries radioactive water. Further inspections uncovered rapid and extensive wear on the tubing within generators that were replaced starting in 2009 at a cost of more than $600 million.

In filings this month to the commission, San Onofre plant operator and majority owner Southern California Edison said plant costs for 2012 exceeded its $613 million authorized annual revenues by several hundred million dollars.

In a news release, Edison said the outage cost it $298 million last year for its share of lost power sales, replacement electricity and other power market expenses.

In state filings, Edison said it also spent $67 million on inspection and analysis. Repairs cost the utility another $27 million. Edison’s legal and regulatory expenses related to the outage exceeded $9 million.

Edison investors currently bear the costs for repairs and replacement power but the company has indicated it will seek authorization to bill customers.

Some costs were offset by savings on nuclear fuel. Edison also received in late December a $45.4 million warranty payment from Mitsubishi Heavy Industries, manufacturer of the faulty generators.

The company has not responded to requests for a more detailed explanation of plant costs.

Edison billed customers nearly $119 million for the cost of the steam generator replacement project, and expects to collect another $130 million in 2013. Edison has told regulators it will file the final cost of the project in March for review by state regulators.

Rapid degradation of the steam generators has been traced to computer models that miscalculated steam flows during the design phase. Fabrication issues also played a role.

San Diego Gas & Electric customers in San Diego and southern Orange counties are ultimately responsible for one-fifth of plant costs, corresponding to the utility’s ownership share. (Edison owns 78.2 percent of the plant, and the City of Riverside owns a small interest.)

SDG&E expects to bill customers $155 million this year for its share of the plant’s operations, maintenance, capital projects and the replacement steam generator project, the company advised state regulators in December.